How harder is live trading?

Hello all

I've been delving into forex for just about 3 weeks but i am a quick learner, especially if i like the subject. So for these past 3 weeks i've learned quite a few things including a bit of candlestick analysis. Based on this puny knowledge, i started practicing with various demos. The thing is, i've been reading everywhere about how hard forex is etc etc, however i've been making 75-100 usd each day risking only 25-50 usd by means of scalping (not exactly, some trades close in seconds, some in 5-30 minutes, 30-50 trades per day). Where's the catch? There must be a catch somewhere, it can't be that easy... Maybe its the demo psychology? i'm pretty good at believing it's real money though.

Is this performance normal? normal in a sense that everybody does it in demo but when they go to live then everything changes. If so then that has some heavy implications for me, all i have to do is control the psychology part of the game.

Hello Sakattack,

welcome to the forum family.
You are right the psychology is important factor.
But I would be on demo more time for short time trading could be a luck.
If you are so good in trading, i can code your strategy for free to have fully automated robot. Take care.

Until you've traded live you're only guessing on what the differences are between demo and live. Just give it a shot and find out.

Pretending demo is real is still just pretending. Even if you've convinced yourself to the T, subconsciously, you'll always know the truth that it isn't real.

And it's not that live is necessarily harder.. but it's definitely different. And that difference is the world of difference.

Yes it is normal, even on a live account, at least for a while until all your demons (even new unknown ones!) start to kick in

The following is by no means a complete assessment or checklist of all the aspects involved, but can give you a hint.

How many hours a day can you expect to be in top form performance?
(presently, how do you manage the 30/50 trades in terms of time, as per my own experience and calculations that would be a full 6/8-hour day, which I consider a little bit high, unless you have a tight discipline of alternating focus and relaxing pauses and detect immediately the signs that you're losing the stamina, stopping then for a while or even for the day).

Do you have a precise strategy for entries or is it just random guessing? Are you reasonably confident in its results?

Risk/reward seems ok, now does it match the win/loss ratio accordingly? Is your money management well adjusted and followed with discipline? Have you analyzed and confirmed the results so you can be totally confident that this aspect will work in the long run?

Do you set a daily goal and stop trading when it's reached (pip / % amount or time limit or quantity of trades limit per day, whichever occurs first)? Do you have a daily loss limit in terms of % of drawdown and stop trading for the day should it be reached?

Do you set stops or close the trade easily when the maximum risk allowed per trade is reached? Should a mistake occur and the trade goes past this limit, are you able to cut the loss anyway instead of waiting and hoping it will come back?

The key pitfalls are:
Greed (as in overtrading).
The usual consideration of "cutting wins too early" as a greedy characteristic wouldn't apply, in my opinion, for a scalper, as it is a very fast very tight move and every pip counts. But overtrading as getting past the daily limit, or trading as a revenge because you need to recoup the previous losses, etc... is greed indeed.

50/100 trades a day for an experienced scalper is "normal" (on a full day schedule).

However you shouldn't expect to be able to perform that way day by day. There will be ups and downs, losing streaks, and if you are not able to immediately stop when things are going wrong, you go down a dwindling spiral.

Panic paralysis / also greed paralysis
Letting losses run, or letting a winning trade become a losing one.
When the trade goes way past the allowed risk, or when you are in the positive but wait a little bit more to see if you get more pips and bam, even if your trading instinct is telling you to close and take what the market is giving you at that moment (or be thankful that you saw the loss before it jumped much higher).

Lack of flexibility
Discipline should be tight and firm but biases and excessive rigidity will cause problems.
Are you able to flow and change direction along with the market and keep a neutral view, reacting on the spot, making each trade a fresh new one in its own time unit?

Lack of realism
Are you expecting to get rich quick or do you have a conservative approach? Have you analyzed your results under a risk-adjusted perspective? Do you know what is your peak-to-trough maximum drawdown %?

You got it right that psychological aspects are key.
However, a sound money management set of rules complete the balance. If you have discipline, patience (to wait for the best setups or to stop for the day if there are no setups) and self-control, if neither losses make you angry and revengeful nor winning streaks excessively overconfident, I guess that you could make it on a live account as well as on the demo. But start small, very small, just in case. And not before you've fully understood all the areas mentioned (strategy, MM rules, RR and risk-adjusted results, psychology, patience and discipline to follow all that to the letter).

The issue you might expect if you don't (as scalping usually brings about a very high winning ratio thus leading to increase risks unnecesarily because you feel on top of the world and think you've "cracked" the market's code... "me knows better" and such attitudes ) is a long series of high returns but with no solid basis.

Work on the solid basis first.
Then you'll have a ground on which to start building with little waste.
And the best part of it, is that you'll gain much more than simple pips or $... you'll acquire a sound knowledge of your own SELF.

Let the market crack YOUR code, not the other way around...

I wish you the best of success in your trading venture!

Damn, what an answer...wow!!!

Most of the things you talked about, i have already thought of and processed, however its one thing to realize what you have to do and another to actually do it. I do not intend to risk any amount money for several months, i got A LOT to learn, especially from people like you (can't beat experience), that's why i posted I do intend however to keep it as simple as possible and to actually make money from my first live account, not because i have to though (i have my own business, which actually enables me to be in front of a pc MANY hours every day, hence the 30/50 trades). My initial (and only) investment will be very small, the smallest possible to get me into a serious ECN broker. The way i see it, the less real risk i take the better my performance will be. I don't care how much i make, only how much i don't lose.

Anyways, you gave me food for thought and my brain is hungry Thanx

It sounds like it's time to open a real account but with small money. Trade with the smallest lots you so that if you are wrong you don't lose much. It may seem odd working for $1 an hour but after 12 hours you could start using "the bank's money". You might be just getting lucky at the moment, but then again, you might not...

I should probably note that the past three weeks have been a lot easier to trade with relatively well defined swings back and forth. You seem to have your wits about you and perhaps it's time to open the smallest live account you can and start getting used to trading live.

this is a fallacy. first off, just because people are able to make money in that supposed 5%, doesn't make them "PROs". just because you lose your account or a large sum of money doesn't make you an amateur.

the real qualifying factor here is sustainability, how LONG you can make money. i believe that those supposed 95% don't drop out because they have failed, but because they havent failed enough. and i dont consider those 5% to be "PROs" until they have sustained profit for a long time. and even if they are able to do that, eventually they will incur large losses. its part of the game.

FX isn't for everyone. you need a large amount of capital to invest. you will eventually have to "pay" some of that money into the market. consider it your education expenses. you will lose quite a bit, but those losses will teach you something

i'm a big proponent of the trial and error, do it yourself school of thought. thats the only way to truly understand something. you have to get your hands dirty.



as for the original question, you might think you are ready, and you might even be, but you wont know for sure until you actually start trading live. real trading ushers in a whole new realm of factors.

first off, its not play money anymore. its money that you spent hours of your life earning. its money that you could be using to feed your children or pay your rent. when you lose that money, it eats at you. ESPECIALLY if you have others dependent on you.

secondly, all the little charges or quirks like rollover, spread, spikes in price, taxes, accidental orders, partial fills, requotes, etc., that were just annoyances before, or even nonexistent, are now real pains. each of these little things could eat a portion of your profits or account. it takes quite a bit of getting used to.

esentially, you have to re learn how to trade, taking all these new factors into account. good luck if youre ready, but you will have to find out first hand what i'm talking about here.

Demo for 3-6 months and that should give you a better benchmark. If you get 3 months in a row with profit, then go live with a small chunk of change. There really isn't a rush, since the market will pretty much always there.

Personally I think that 3 weeks is too short to come to any conclusion. Continue to use your strategy to trade demo for another 2 months and if you are able to have the same results, you can then move on to live trading.

You will not perform the same. I will tell you what the catch is!!!

You trade demo, do your hands get clammy, does your heart beat faster, do alldoubts and fear run through your mind? WHen you trade live you will be able to answer these questions.

My biggest obstacle is getting fills when I would expect to get them. Every night I have to "Beat the System". I set a "Sell to Close" at 1.22900. BID hits 1.22902... ASK is at 1.22928. I don't get filled, so I have to go into CREATIVE mode and sell at MARKET when I'm ready. Tonight it cost me money :-(

With Demos you always get filled when you expect to. In Real time you may have a problem, especially with momentum trades. Limit yourself to $100 accounts so it doesn't hurt when you get burned even though you had it right! Expect to go through several $100 accounts.


<subscript> btw my thinking is euro will hit 1.18. May Bounce / May Blow thru, but it will hit 1.18.

A lot harder.

I use to play an Etrade demo that was a competition and the top earner got a little bit of money. I ended up getting third place one month which was impressive considering there was thousands of people playing the stock market game. I think I got a free t-shirt for getting third place. I think I doubled my profit in a month to win. But I didn't do that every month. Some months I would make a little while most times I would break even or lose. I think the difference between a demo and reality is that you are more willing to take bigger risks when it's not your money.

If you dont have a huge account don't even strategize with market limit orders, You know how many trades are missed because it does not hit peoples price target, and bam what a great trade wasted.

Use moneymangement and if you are 10 pips from your entry but it's struggeling to get there and you just sit on the sidelines, most likely you just missed out on a great oppertunity to see the trade go well 50+ pips in the direction you thought it would go.

You need room for drawdown, and if you ahve patience you can wait to short at resistance and buy at support.

It's HARD until YOU decide that: it's not HARD ... or just give up

based on you only ...

This is what I believe. The brokers are plugged into Metatrader Manager a supercomputer that handles EVERYTHING, they are all using account information including trade prices, stops, and targets, they are all stop hunting, and they are trading the bulk of our own money against us and they are NEVER going your way. I tested several top-rated robots and I watched them easily sidestep every single red and green line because they use the information in their computer to know exactly where those prices are, you can also see it on your own trades. When it happens, save a picture, it will eventually become obvious the Forex market is controlled and totally manipulated by the brokers, banks, and commercials. On another robot, I watched as they twice reached down and easily took out 50 pip stop losses and then turned back up. My brother didn't believe how they exactly hit my prices until it happened to him: they took out his stop loss TO THE PIP and then circled exactly within a pip or two of his target. These manipulation patterns occur with my trades all of the time.

Thats likely because these "top rated robots" were garbage. Learn how to trade for yourself and you wont feel so jaded but then again, you wont have some externality to blame either.

I totally agree with this. Demo trading is not real. And pretending that demo trading is real doesn't work.
Unless it is real money, its not real.

One of my favorite words to describe demo is
vaccine :
"n.
A preparation of a weakened or killed pathogen, such as a bacterium or virus, or of a portion of the pathogen's structure that upon administration stimulates antibody production or cellular immunity against the pathogen but is incapable of causing severe infection."

I did trade for 1 1/2 decades without demo, and am very sorry I did. I thought I could jump into the market to take an opportunity without a consistent plan for all the other trades, too. Lost, and the more I tried, the worse it got. I couldn't get rid of it.
Plus, I had to do taxes. What a headache! Sure, it feels good when you get money returned to you; only, you're fooling yourself if you think you're trading real. They ought to have a special tax section for gamblers like this.
Plus, after a hundred or two times of margin calls, platform delays (YES, some broke rs do this in demo,) and rewritten technical chart studies, I feel like I can jump in and change my entire approach to fit what the charts say. Trading adaptability increases dramatically with demo use: There's so many factors to trading real, that if you don't separate them and deal with them one or a few at a time, you'll be overwhelmed when a lot of them go bad at the same time. (An order delays while the trading plan's chart study was subpar, and you have to leave the screen for other business when you thought you could watch the order and thus not have a SL this time during the symbol's peak hours, for example.)

Sure, you won't get the brunt of some of real's factors such as
the dramatic increase in psychic pressure to perform,
dealing with the broke r, or
number-crunching statistics from your statement, trading plan's performance, or taxes.

These are icing on the cake that demo chooses and mixes the ingredients of:
Platform breakdown and other distraction use,
choosing one technical studies approach,
making an edge of that technical studies,
acclimatization to trading's rampant failure rate, and, lastly,
showing in multiple trading formats on the chart (paper, simulator, demo), times of day and year, and, optionally, different symbols.

So just set aside what you consider significant money and burn in those bad, confused feelings real gambling provides. Once that money is gone, demo for a year or more while you understand how skill is at once the most important thing and a mere foot in the door to the chance one's guess is correct about what direction and drawdown thousands of trades will produce on the chart next.
Then, when comfortable with using demo, ease slowly into trading for pennies -- at least, this is what I believe I'll do -- and the discomfort real brings will return. The vaccine pennies gives to full-money real, is about all one can do to be ready to join the ranks of others constantly on the brink of financial disaster.


Of course, some people can naturally figure all that demo (and pennies) provides, in real.
"It's just another job", or whatever. They bring in experience from a similar field, such as real gambling, playing sports, or a nontrading financial career.
For most, trading's difficulties are unfamiliar, and its realities are difficult to accept.

Practice takes care of this, for all.
And if I don't make it on demo, or pennies, when I get to real, I'll know what it takes to be a trader, and if I still fail at real and it's not just the shock of going to another trading type, I'll know whether or not I'm a person who belongs in trading.


In sum, demo is different from real, and not everyone needs to do it, but for most people, it's invaluable.